Business loan eligibility explained: the hard gates, the judgement calls and the workarounds

“Am I even eligible?” is the question that stops many owners from applying at all. It’s also a question with a more useful answer than most lender websites give, because eligibility isn’t one test. It’s two different kinds of test stacked on top of each other.

The first kind is a gate: a fixed, published minimum. Six months of trading. $10k a month in sales. An active ABN. If you don’t meet it, the product is closed to you, and no amount of explaining changes that.

The second kind is a judgement call: credit history, tax debt, industry, the purpose of the loan. These are weighed, not ticked. A weakness in one can be offset by strength elsewhere.

Owners often confuse the two. They assume an old default is a gate (usually it isn’t) and that trading time is negotiable (usually it isn’t). Sorting your situation into the right box tells you quickly where to apply and where not to waste a credit enquiry.

What are the hard gates?

These are the minimums lenders tend to publish. Miss one and that particular product won’t be available, though another lender’s may be.

Gate	What it usually means	Why lenders insist
Age	Every applicant and guarantor is 18 or over	Legal capacity to contract
Active ABN	Registered and current, matching the business name	Confirms a real, identifiable business
Trading time	Often 6, 12 or 24 months, depending on product	Enough history to judge reliability
Minimum turnover	A monthly or annual sales floor	Shows the business can carry a repayment
Residency	Some lenders require citizens or permanent residents	Recovery risk if a guarantor leaves Australia
GST registration	Required by some lenders, not others	Signals turnover above $75k and BAS records
Business purpose	Funds go to commercial use, not household spending	Business lending sits outside consumer credit law
Australian business account	Trading income runs through a local account	Lenders read it to assess cash flow

What lenders actually publish

Here’s how two well-known online lenders state their gates, as at October 2026, taken from their own websites.

	Prospa Small Business Loan	Moula business loan
Trading history	From 6 months	12 months or more
Turnover	$6k a month	$10k a month in sales
GST registration	Not listed as required	Required
Residency	Owners must be Australian citizens or permanent residents	Not stated on the main page
Other	18+, active ABN, valid driver licence	Active ABN or ACN
Amounts	$5k to $500k	$10k to $500k

Two lenders, both offering unsecured loans of up to $500k, with quite different doors. A seven-month-old café turning over $8k a month, not yet registered for GST, would pass Prospa’s published gates and fail Moula’s on three counts. That’s the practical point: being turned away by one lender’s minimums says almost nothing about the next lender’s.

Prospa also publishes tighter gates for its bigger products. Its Business Loan Plus, for $500k to $1m, lists a minimum of three years’ trading, $2m annual turnover and property or asset ownership. Larger amounts mean higher gates almost everywhere.

The trading-time gate, up close

Trading time trips up more applicants than any other gate. A few things to know:

• It’s measured from when the business started trading, which lenders typically check against your bank statements and ABN registration. An ABN registered years ago for a business that only began trading recently won’t usually count as years of history.
• Buying an existing business can help. Some lenders consider the business’s trading history rather than how long you’ve owned it, particularly with acquisition finance.
• Property security can lower it. A lender secured by property is relying less on the business’s track record. Our pages on business loans with an ABN under 6 months and new businesses with an ABN under 12 months set out the options.

The turnover gate, up close

Minimum turnover is usually measured as average monthly deposits into the business account over the period the lender reviews. Two traps:

• Transfers aren’t turnover. Money moved from your personal account or a savings account isn’t sales and will be excluded.
• Split accounts hide sales. If card takings land in one account and invoice payments in another, give the lender both, or your turnover will look smaller than it is.

Sitting a little below a lender’s sales floor? our page on business loans for low-turnover businesses explains which products set the bar lower.

The GST gate, up close

According to the ATO, registration becomes compulsory for most businesses when GST turnover hits $75k, and has 21 days to do so after crossing that threshold. Below that, registration is optional. Lenders that require GST registration are effectively requiring turnover above that level and a BAS history to check. If you’re under the threshold, look for lenders that assess on bank statements alone; business loans when you’re not registered for GST covers them.

Unsure which gates you clear? Ask us in about a minute; we’ll tell you which products are realistic, and there’s no credit check for asking.

What are the judgement calls?

These factors won’t automatically rule you in or out. They’re weighed against everything else.

Credit history. Recent, unpaid defaults and current bankruptcy close most mainstream doors. Older or paid defaults, a past Part IX agreement or a discharged bankruptcy are often considered, especially by non-bank and private lenders. See bad credit business loans.

ATO debt. A tax debt on an instalment plan that’s being met is often acceptable. A large, unmanaged debt is harder, partly because it may have been reported to credit bureaus. The detail sits under ATO tax debt business loans.

Industry. Most lenders have a list of industries they restrict or avoid, and the lists differ. Gambling, adult services and some high-risk sectors are commonly excluded; construction, hospitality and transport are sometimes treated more cautiously. One lender’s exclusion is another’s speciality.

Purpose. Business purposes only, and some lenders won’t fund certain uses, such as paying out another unsecured lender or speculative investment.

Existing debt. A business already carrying several online loans may meet every gate yet be declined because there’s no room for another repayment.

Business structure. Every common structure (sole trader, partnership, company, trust) is lendable, though each brings its own paperwork. Trusts need the deed checked; companies need director guarantees; partnerships usually need every partner to sign. None of these is a gate in itself.

Can visa holders and newer migrants borrow?

Residency is one of the more variable gates. Some lenders, Prospa among them on its published criteria, limit their unsecured products to Australian citizens and permanent residents. Others will consider holders of certain visas, often weighing the visa subclass, the time remaining on it, and whether there’s property security or a citizen or permanent resident who will guarantee the loan. Our page on business loans for migrants and visa holders has more.

How property security changes the gates

Security doesn’t remove eligibility rules, but it can swap some of them out. A lender holding a mortgage or caveat over property is relying on the property as much as the business, so it may accept:

• fewer months on the books
• turnover that’s modest or uneven
• credit history that a cash flow lender wouldn’t accept
• less formal financial evidence

The gates that remain are the property ones: enough equity, an acceptable property type and location, and a believable plan for repaying. Equity’s role in capping the amount is worked through in how much can my business borrow. Where property backs the loan, we can help with amounts between $20k and $5m.

A three-minute self-check

Run through this before you apply anywhere.

1. How many months has the business been trading? Under 6, 6 to 12, 12 to 24, or over 24?
2. What are average monthly sales into the business account? Use the last six months, sales only.
3. Are you registered for GST?
4. Are all directors Australian citizens or permanent residents?
5. Any unpaid defaults, current bankruptcy or court judgments on any director’s file?
6. Does the business owe the ATO, and if so, is an instalment arrangement in place?
7. Is property or equipment available as security?

Questions 1 to 4 tell you which published gates you clear. Questions 5 and 6 tell you how the judgement calls are likely to land. Question 7 tells you whether a different set of gates is available.

A worked example: two businesses, different doors

Here’s an illustration. Two owners in Hobart each want $60k.

The first runs a mobile dog-grooming business that’s been trading for eight months, banking about $9k a month, not registered for GST, with clean credit. She clears the published gates of a lender with a six-month minimum and a $6k monthly floor, but not a lender requiring a year of trading and GST registration. An unsecured application to the first kind of lender makes sense.

The second runs a joinery workshop that’s traded for six years with $55k monthly sales, but has a $14k default from a failed supplier dispute two years ago and a $70k ATO debt on a plan. He clears every published gate comfortably; his challenge is entirely in the judgement calls. A non-bank lender comfortable with explained defaults and managed tax debt, or a loan secured by his home, would suit him better than a scorecard-driven fintech.

Not sure which doors are open? We’ll check for you

Eligibility rules are scattered across dozens of lender websites and change without notice. We keep track of them so you don’t have to, and we can usually tell within one conversation which lenders’ gates you’ll clear and how your judgement calls are likely to be read.

The form is about a minute’s work and asking us involves zero credit checks, so your rating is safe. We pick lenders for you carefully rather than scattering your enquiry across the market, so you won’t be chased by lenders you never asked to hear from. A human being on our team reviews your answers and gives you a ring. Give us your genuine trading time, monthly sales and credit position; honest inputs mean the first lender we suggest is one whose gates you actually clear.

See which lenders I qualify for →